Inland Empire Multifamily Sales Tumble 72% as Smaller Units Get Targeted
Multifamily sales activity in the Inland Empire was weak in the second quarter, with volume falling to $86.3 million, a 71.9 percent decrease from the previous three months, a CBRE report finds.
CBRE attributed the plunge to investors targeting "smaller projects during the quarter."
The top sale by volume involved La Vista Apartments, which Yong Yuan paid $22.73 million for. Yong Yuan had another large buy, with its $7.58 million acquisition of 8969 Newport Avenue. The only other transaction to exceed seven figures was Torben Welch's $12.30 million purchase of Echo Apartments in San Bernardi.
Despite the less-than-ideal investment activity, the overall fundamentals are far from poor for multifamily in the Inland Empire. For one, demand remains strong, with 2,450 units absorbed in the second quarter, up from the 1,974 in the previous three months. CBRE said that renters were attracted to the area due to its affordability.
Rents were up by a modest 0.6 percent to $2,334, which the CRE firm attributed to "increased competitiveness for limited available space."
Additionally, occupancy inched up by 40 basis points to 96.1 percent.
As far as supply goes, 1,703 units were delivered, up from the 1,512 in the first quarter. The Fontana/Rialto/Colton area recorded the most deliveries in the second quarter, with 548 units coming online.
"Multifamily development remained a highlight as developers identified population growth in the IE as a key indicator for construction opportunities," CBRE noted.
Source: GlobeSt/ALM